B Company is considering the purchase of a piece of equipment that costs $23,000. Projected net annual cash flows over the projects life are:

Year Net Annual Cash Flow

1 $3,000

2 8,000

3 15,000

4 9,000

The cash payback period is:

a) 2.63 years.

b) 2.80 years.

c) 2.37 years.

d) 2.20 years.